Shows & Panels
- Accelerate and Streamline for Better Customer Service
- Ask the CIO
- The Big Data Dilemma
- Carrying On with Continuity of Operations
- Client Virtualization Solutions
- Data Protection in a Virtual World
- Expert Voices
- Federal Executive Forum
- Federal IT Challenge
- Federal Tech Talk
- Feds in the Cloud
- Health IT: A Policy Change Agent
- Improving Healthcare Outcomes through IT Policy
- IT Innovation in the New Era of Government
- Making Dollars And Sense Out of Data Center Consolidation
- Navigating the Private Cloud
- One Step to the Cloud, Two Steps Toward Innovation
- Path to FDCCI Compliance
- Take Command of Your Mobility Initiative
Shows & Panels
TSP: Are You In The Money?
Monday - 8/15/2011, 2:00am EDT
The average balance for feds investing in the TSP — their in-house version of a 401k plan — the average balance is up just over $13,000 from what it was in December 2009.
As of June 30, 2011, the average account balance for long-time civil servants under the older, and more generous, civil service retirement system (CSRS) was $81,875.95.
The same June snapshot of the TSP accounts of feds hired under the newer federal employees retirement system (FERS) shows they have an average account balance of $81,144.40.
In December, 2009 the average account balance for both groups was just over $68,000.
Members of the uniformed military services, who tend to be younger and paid less than federal civilian workers, have an average TSP account balance of $12,685.42.
Most American workers don't have the option of a 401k plan account. If they do, it is unusual for the employer to match contributions at the 5 percent level. Many, if not most, don't provide any match.
Retirement benefits of CSRS employees are computed under a more generous formula than FERS. But FERS employees are eligible for matching contributions from their agencies of up to 5 percent. That's the equivalent of a 5 percent tax-deferred pay raise, provided the investors put in at least 5 percent of their own money. Employees who don't invest in the TSP, the government equivalent of a 401k plan, still get a 1 percent contribution from the government.
Annuities of feds under the old CSRS system are figured on a more generous formula than used to determine FERS benefits. Because of that CSRS investors in the TSP don't get any government match. Military personnel also do not qualify for any matching TSP contributions because Congress setup the program that way, and Pentagon bean-counters have fought any improvements because of the higher cost to the government.
Averages, of course, are just that. More than 10,000 feds have TSP account balances ranging from $500,000 to just over $3 million. But if you've been investing the maximum since day one and you still don't have a huge account, don't blame yourself.
Most, if not all, of the TSP millionaires accumulated that money before they joined government. The majority of them were lawyers (now federal judges), or doctors, corporate executives who came into government or one of the many millionaires elected to Congress. Being smart people — or having the ability to marry well — they realize the TSP is overseen by the government, has the lowest administrative fees in the business and is the only 401k plan account that offers stocks, bonds and super-safe, never-have-a-bad-day Treasury securities in the G-fund.
NEARLY USELESS FACTOID
Devotees of Klingon — the dialect of the fictional warrior race from Star Trek — have even translated Shakespeare's Hamlet into the guttural tongue, according to The Economist, which ponders whether "aH pagh taH be" still has the same ring to it.
MORE FROM FEDERAL NEWS RADIO
Postal Service plans to cut 220,000 jobs
The cash-strapped Postal Service is working on plans to cut 220,000 jobs, or 38 percent of its workforce, by 2015. The agency faces about $9 billion in losses this year, as mail volume declines, the agency's chief human resources officer, Tony Vegliante, told Federal News Radio News Radio.
GAO plans to offer buyouts, early retirements
The Government Accountability Office plans to offer buyouts and early retirements to employees in 56 positions. The agency wants to reduce its workforce in anticipation of a smaller 2012 budget.
Air Force announces hiring freeze, buyouts
The Air Force will freeze the hiring of any new civilians for 90 days, the service said in a statement Friday. The freeze became effective August 9, and will be accompanied by buyouts and early retirements under the Voluntarily Early Retirement Authority and Voluntary Early Separation programs.
How will credit downgrade affect retirements?
In the past six months, the federal government has narrowly dodged a government shutdown, barely missed a default deadline and is currently went through a credit rating downgrade. Many federal workers believe it's no longer a question of if - but when - the 'other shoe' will to drop.